Guatemala farm policy analysis : the impact of small-farm credit on income, employment, and food production

Farmers live in conditions of extreme poverty, suffer high unemployment rates and have low food production levels. Over the last decade a variety of programs including credit, research, and extension have been undertaken to improve the rural situation. This study is an attempt to evaluate the impact of these programs on the three most important objectives for the Guatemalan agricultural sector. These are: (1) Increasing food production, (2) increasing small farmer net incomes (the "equity" objective), and (3) increasing rural employment. The analysis is based on data gathered by the Government of Guatemala from 1600 farms in 1974. Half of the sampled farms had been receiving institutional production credit (BANDESA) and technical assistance. The other half were selected as a control group of farms with similar size, endowment, and locational characteristics, but without institutional credit.